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Stephen Wunker MD, New Markets Advisors on Building Solutions That Help Your Customers Get Things Done

Stephen Wunker Managing Director New Markets Advisors chats with Shripati Acharya , Managing Partner Prime Venture Partners .

Steve Wunker led development of one of the world’s first smartphones, has built and sold several successful businesses, and advises companies worldwide.

He is Managing Director of New Markets Advisors and the author of several books including Costovation: Innovation That Gives Your Customers Exactly What They Want and Jobs to be Done: A Roadmap for Customer-Centered Innovation.

He also writes for Forbes, Harvard Business Review, The Financial Times and other major outlets. He has an MBA from Harvard Business School, a Master’s of Public Administration from Columbia University, and a BA from Princeton University. He has also been a guest lecturer at Dartmouth’s Tuck School of Business

Listen to the episode to learn about:

03:33 What is Jobs to Be Done framework

06:13 Example of the framework for Ice cream company

08:31Applying the framework on technology startups

14:43 Using the Jobs to Be Done framework for Product Market Fit

16:35 Applying the framework in B2B scenarios

19:50 Can this framework be applied to pricing?

21:39 The bare minimum Stephen suggests entrepreneurs to do before creating and launching products

27:04: Working with Clayton Christensen.

Read the complete transcript below

Shripati Acharya 0:53

Hi, and Welcome to Prime Ventures Podcast. This is Shripati Acharya, Managing Partner at Prime, and our guest today is Stephen Wunker.

Stephen led development of one of the world’s first smart phones, has built and sold several successful businesses and advises companies worldwide. He’s Managing Director of New Markets Advisors and the author of several books, including Cost-O-Vation- Innovation That Gives Your Customers Exactly What They Want and Jobs to be done a roadmap for customer centered innovation.

He also writes for Forbes, the Harvard Business Review, the Financial Times, and other media outlets. He is an MBA from Harvard Business School, a Master’s of Public Administration from Columbia University, and BA from Princeton University. He has also been a guest lecturer at Dartmouth Tuck School of Business. Prior to founding New Markets 10 years ago, he also spent many years with Harvard’s Clayton Christensen, building up his consulting practice. Welcome Stephen to the podcast.

Stephen Wunker 1:54

Thanks for having me.

Shripati Acharya 1:56

Stephen, you have written the book on Jobs to be done framework. So let me first ask you what are the origins of this framework? What was the motivation behind having another framework to look at the business issues?

Stephen Wunker 2:12

Sure, So as you mentioned, I worked for many years with Clayton Christensen at Harvard Business School as he was starting up his consulting practices. After he had published his first really seminal book called The Innovator’s Dilemma about how entrants disrupt existing marketplaces. He got a lot of questions about how those companies can identify what they really become. And so he looked and looked for explanatory theories that would really lay out when a company had a high likelihood of success. And he came across what at the time was a niche idea by two consultants who were at the time focused on the bakery business called jobs to be done and he learned more and more about it and really popularized it in his second book, which is called the innovator’s solution. Since then he talked about it a lot. He actually wrote a book about four years ago called Competing Against Luck. And he got the idea out there, what I did was, I was one of the first people to have the privilege of doing this with clay having tried to translate that from writings into active action and practice. So what I did my book jobs to be done is really tried to operationalize the theory into something that people can use on a day to day basis.

Shripati Acharya 2:13

So perhaps we can launch right into it. So what is the jobs to be done framework?

Stephen Wunker 3:33

So the framework asserts that people are not actually out to buy things, whether they are products or services, they’re trying to get things done in their lives and product or service may happen to get that job done, but they’re very different ways of accomplishing this. Sometimes I do a mock focus group with groups asking people to imagine themselves working for an ice cream company. So the first question is, okay, we need to sell more ice cream. What are we going to do? And the answers are always the same: more flavors, less calories, more distribution, give it away for free. Great, nothing original there, right? And then you turn the question around and you say, okay, let’s forget about working for an ice cream company.

Tell me instead, the last occasion, not times on average, but the specific last time that you had an ice cream. Why did you have ice cream? And if ice cream hadn’t been there, what would you have done? And you get a completely different set of answers. Well, I was celebrating after my daughter’s softball game, and we decided to go to an ice cream store with a couple of her teammates to have an experience together. It was a really hot day and I came in from being outside. I wanted to cool down and my choices were between having a beer or an ice cream, but it was a little early in the day for a beer. So I went for the ice cream. I was alone and figured I’m watching some movie on Netflix, I wanted to indulge a bit, and the ice cream was right there. It really spoke to me as an indulgence.

And so you understand that the jobs that an ice cream is getting done. It’s not about eating more flavors. It’s about cooling down or celebration or indulgence, a very different set of things which could be accomplished in a lot of different ways. But by understanding those fundamental drivers of behavior, an ice cream company can differentiate itself beyond just providing a new type of flavor in a tub of ice cream, but in delivering experiences. Unilever’s done this very effectively. So that’s how you get it what really determines product market fit. What are people really looking to get done, not what are they happening to buy today. And then can you accomplish that in a differentiated manner.

Shripati Acharya 6:06

So what are some of the answers which they after the end of this exercise, what are some of the answers on the ice cream front.

Stephen Wunker 6:13

So let me give you an example from Unilever with their Ben and Jerry’s brand. So they recognize that people want to have an experience in their personal moments, so they want it somewhat personalized to them, that it can also be an indulgent moment. So they created a line of ice creams called Core. So for instance, there is a vanilla ice cream on one side of the tube and cookie dough ice cream on the other side of the tub, just a regular pint sized cardboard tub. And in the center, there’s this core column of thick, chocolaty goo. Now, you could just eat the goo in itself and that would really be indulgent.

Few people do that, but it does call out the fact that ohhh!!, this is an indulgent time, people are not having ice cream to be virtuous. They are not in their virtue business here. But you mix it together. And in the mixing, it’s something that you can do socially, like you can have your daughter mix it with you. So it becomes a bonding experience. And every time it’s a different mix. And so it’s a different experience. It’s a different outcome.

It’s something that you’ve created, you put a little bit of yourself in the ice cream, because it’s a very personal sort of food. It’s not like eating a sprig of broccoli, you want to really have some of you in it. And so by configuring the contents of this otherwise very ordinary cardboard tub in a unique way that delivers both indulgence and experience and customization. Unilever has been able to take out a corner of this very competitive market that is really proprietary to them because it activates on those jobs to be done.

Shripati Acharya 7:59

Clearly wouldn’t come at the top of one’s mind if you thought of expanding the ice cream market that way. So that’s in our audience who are tech entrepreneurs, and they are in the business of finding that elusive product market fit. So from that standpoint, Stephen, have you experienced the framework being applied in technology without first going into the startup side, just in technology in general?

Stephen Wunker 8:31

Absolutely! So, look, I love to use consumer products examples because they’re simple and we can all relate to them. But I would say in the tech community, we see the loudest evangelism for jobs to be done. Our biggest client as a company is Twitter. Jack Dorsey is a fervent believer in jobs to be done. He often talks about the two Twitter jobs of 1. launch something new and 2. connect with what’s happening for advertisers. And there’s others too, but I won’t talk too much about Twitter. But you know, Jack is out there very strongly hammering this again and again, tell me what job your feature is getting done. Otherwise, why do we need this feature?

I’ll give you an example I can talk about pretty publicly. It’s actually on our website, which is a company in Los Angeles called iRise. So iRise many years ago created the market for visualizing website functionality before there were wireframes. It was basically the iRise system to create these clickable prototypes. And they created an industry leading package which got to be very fancy and very expensive. And then it was disrupted by firms like Balsamic and Figma that had lower fidelity, lower functionality prototypes, but at a vastly cheaper, even free cost. And so they needed to figure out, where are they going to go in the marketplace? We worked with them to determine what are the jobs that they’re trying to get done. And we used our framework that’s called the Jobs Atlas that’s laid out in our book jobs to be done. It’s also on our website for the book, jobsroadmap.com.

And the Jobs Atlas looks not only at the jobs, but at the whole system around it. It looks at the drivers or contextual factors of why certain people prioritize jobs in certain situations. What are they doing today? And what are the pain points around what they’re doing today? What are the criteria to know about whether you’re successfully meeting a job or not? And what gets in the way of successfully getting that job done? How much value do you create by getting that job done? And then what are the competitive factors that you really compete against the real competition for getting that job done, which may be traditional, but also very atypical. The thing about that framework, by the way, is that is completely the opposite of how most companies think about things. They start with the competition, what’s our competitors doing? And then what can we price it at? What’s the value? And then okay, what obstacles do we need to get over to get to market? And what are the metrics and design parameters, and maybe eventually they’ll get to the job to be done. But you know, we say you got to root in the job.

So for iRise, what they did was step back and they looked at the software development lifecycle, and they really wanted to understand what’s the context of use for wireframing software. They realize that as agile got more and more traction in software development, people were cobbling together their epics and the stories within them in a very haphazard way. We had moved from this very rigorous process of requirements definition in more of a waterfall type approach to what was extraordinarily messy, and while worked on a small scale when you translated that to bigger development projects, you know, their reality was sort of ugly, not only in terms of determining the hierarchy of things, but really in communicating around a larger organization.

What are we talking about with the story? How is this really going to work? What are your feedbacks, the different pivot points in the story, things that we can really act upon? How does it relate to these other things? And wireframing could be a great way of communicating that but people were still cobbling together their basic free tools. And then they were using some Google Doc to write in comments and then they were putting the backlog into JIRA and then prioritizing what they were going to do. And it was this ugly cobbling together all the solutions. And so they created a system for requirements definition in an agile environment using wireframes. And that was novel in the marketplace. They could price it at a point where they could capture the value they stood out even being a relatively small company, about 30 people.

And they created this new market space that actually people were trying to get done for a long time. They were just answering the challenge in very different ways. Peter Drucker, who was one of the great management theorists of the 20th century, wrote 50 years ago. He wrote that a customer rarely buys what the company thinks that is selling him. That was totally the case in the requirements definition and Agile Software market, then we could understand what the customer is actually buying. And they were very awkwardly piecing together but iRise was able to get it right.

Shripati Acharya 13:58

So that’s a fascinating story. Both the Twitter example you gave Stephen and also the iRise example, so in a startup, you frequently don’t know the product, which you need to build. So you have got something, you put it out there, some folks are using it. And then you want to ideally iterate quickly towards something which is this thing called product market fit, wherein the demand fastly exceeds supply and then you are in business.

So in that kind of environment, how should entrepreneurs in this game go about following this framework to achieve PMF faster if it’s possible, or maybe at least start exploring in the right direction.

Stephen Wunker 14:43

So this is an emotionally hard thing to do, but you need to not be totally in love with your solution. Rather, you need to go out and talk to people in a very open ended manner and understand what they are trying to get done, and that is usually an oblique conversation where you triangulate things. If you actually just go out and ask, What are you trying to get done with ice cream? Well, you know, people will look at you like you’re from Mars. So you need to understand the context and what the priorities really were. And then ultimately, you might get there, Okay, so what role was ice cream playing in that occasion, but you got to understand things. And as you do that repeatedly, in different contexts, you really start to understand what priorities people have in different contexts.

And then you can put together okay, so for that certain situation, here’s what they actually did. And here’s what fit in did not fit about that situation. So this allows you to segment the market in a different way than just what the people happen to be consuming today, which isn’t really the best way to do it, or long thermographic or demographic variables which may correlate to the jobs to be done, but they are not root drivers of behavior. It allows you to segment based upon what really drives purchasing usage behavior, which are those jobs to be done. And then you can tailor propositions that are really commensurate for that particular situation.

Shripati Acharya 16:26

So would this also work even in a business to business kind of situation where you’re a b2b company selling to enterprise businesses.

Stephen Wunker 16:35

Absolutely! It is a really useful way to sort of look across stakeholder types and understand the very different jobs and their different approaches and success criteria so that you can determine who you’re really trying to target. So let’s give a very different example. A company we worked with that did telematics for trucking fleets was typically selling to purchasing managers. And there are a few of these telematics solutions on the marketplace. And they were just getting hammered on price.

And so they step back, and they tried to understand what operational fleet managers were doing, or for a large trucking companies, the planners for fleet, or HR, what was HR trying to do, and they were able to cobble together not just systems that spat out data, but systems that did something with the data. And because that was unique and made those folks jobs much easier. They were then able to sell to these other stakeholders who could then pull on the purchasing department and say, I know this company is 20% more expensive than the other, but they actually helped me do what I need to get done.

So please, let’s evaluate on that, and not just on the easy apples to apples considerations that I know you in purchasing want to prioritize. We do this in healthcare all the time where there’s doctors and hospital administrators and patients who are often forgotten about, and the caregivers of patients and insurance companies, and you have to understand all of those different jobs to be done to really get a grasp on the prospects for say, a new medical device or a drug.

Shripati Acharya 18:28

That’s fascinating! What you are saying Stephen is that it’s not just the product that you’re selling to a buyer, you’re selling it to your target customer, which has got all the secondary users of that product as well. So the jobs to be done is actually what’s going on within that organization, not just that particular customer who you think is your buyer.

Stephen Wunker 18:48

Absolutely! You get a lot more levers available for differentiation and innovation. If you can think about all the stakeholders who are involved and not just think about a business as some monolith. One of the other important things to remember, in b2b sales, which often gets forgotten is that human beings are not robots.

There are emotional factors that go into any purchase, the purchase of surgical equipment or advertising technology has emotional as well as functional factors. And so you have to be cognizant of how a solution might make somebody look good or visionary or reduce pressure from a boss. Yeah, that stuff really matters.

Shripati Acharya 19:35

So do you think Stephen that to the extent that this particular framework is enabling me to ascertain the value which I’m providing to the customer can it also be used to figure out pricing in a better way?

Stephen Wunker 19:50

It can. So I’ll give you another example. When BMW sought to relaunch the mini brand, they bought this brand in the 90s as part of a larger acquisition, The Mini had been defunct for close to 30 years. People thought they were crazy. Nobody was making money in the small car market. Why would BMW go to the small car market, but they realized through this sort of research, that people were struggling to assert their individuality and their uniqueness and to say they are still fun.

Their target customer was actually people in their 30s, who, they had two kids and they were going to 15 soccer practices a week, but they were saying, I am still fun and special and unique. So their competition for getting that job wasn’t just Honda and Toyota, it was vacations and fashion. And they calculated they could charge a $5,000 premium to cars like the Honda Fit or the Toyota Yaris with a fairly comparably spec-ed car. But because the body, which is extremely cheap to customize, but the body is unique, they were able to land on this job to be done that their competitors could not. So they got a $5,000 Premium in the marketplace, they make tons of money where their competitors don’t, because they realized the true value of the job they were getting done.

Shripati Acharya 21:24

So if I’m a startup and I might be selling to businesses or consumers. So what will be the first, if you could just break it down into that, what do you say the 1,2,3. At a minimum, you’d like to see get done before they launch and create their solution.

Stephen Wunker 21:39

So get out of your office and talk to real people. I guess with COVID we can do that via zoom, but to talk to real people and don’t just have a superficial conversation, talk with them for 30 to 60 minutes and really try to understand their context and why they make particular decisions. Notice with the ice cream example, I didn’t talk about times on average when somebody wants an ice cream, is then you might say, well, I want something sweet. I’d like to have a treat. Yeah, that’s dull. We want to get at the richness of context and individual stories, get those stories and try to understand the jobs. For a lot of people, I would say do minimum 15 of these interviews, you might do 30 or 50, depending upon how much variation there is in the marketplace.

Then inductively look at what are those jobs that emerge and some of the other components of the jobs Atlas, which again, is at jobsroadmap.com, a downloadable template, and categorize people and then try to segment them out. I saw people like Shripati, and I think I saw six other people like Shripati. And so Shripati might be a segment and he buys differently than Sunil who has these very different sets of priorities. So as you can do that, then you start understanding the market probably in a different way than your competitors. And then you can figure out, okay, what would be the ideal solution? Oftentimes, the solution for those people is actually less expensive than competitors have over engineered their solutions for because they’re creating something which isn’t really having that fit, right? They’re over ornamenting. And so the real solution that goes to the theme of my most recent book Cost-O-Vation can often be quite inexpensive, if you truly understand what’s the market.

Shripati Acharya 23:39

Well, that’s helpful. So tell me, what are some of the ways in which you don’t use these things? Or some of the most common mistakes where you probably conflate some of the conclusions which you are drawing. Have you seen that happen as well?

Stephen Wunker 23:55

Oh, yes! So the challenge with a popular Management Framework disruptive innovation had this challenge too, is that people use the language and they twist it for totally different purposes. So the phenomenon of old wine in new bottles occurs a lot. So people will say, Well, you know, you just have to determine the features that people need. And that’s the jobs to be done. And look, BMW did not determine the headroom that people need and the turning radius to understand that the job was individuality. Yes, you have to determine those features eventually. But you’ve got to get your ordering of priorities right.

There are other folks who will say well just ask people what they want. And you know, Henry Ford refutedly said if I’d asked people what they wanted, they would have said a faster horse. So yes, eventually you should ask people what they want, but first understand why they’re doing what they’re doing, and even more, so why aren’t they doing some things that might be some priorities, that’s a great opportunity for a market.

You also want to avoid getting too micro too fast. There are some companies out there that say, well, you need to determine 80 different outcomes that people are trying to have with their product. And then you can engineer to meet those 80 outcomes or prioritize among, but there’s still hierarchy among those, there’s no, “why” that underlies the success metrics that people have for a product, then you sort of very easily lose the thread and it can deviate into things that are not priorities, or you have all this data that you don’t know what to do with. You also want to avoid just seeking out one job.

There’s a company I talked to once in the diabetes space, and they said, well, the job of our customers is to control their glucose. Well, you know, why did they have the pastry? That sounds wonderful, but the world isn’t working like that. So that is a very idealized way of thinking about things. But people seldom have one job. And it’s seldom totally rational and functional, because we are not robots. So you’ve got to really understand the world in the richness that presents itself and not in the very clean way that you would like it. Because that’s very convenient for your corporate communications. So there’s a lot of errors that people can make. I think it really stems through trying to simplify things to such a degree that you miss the world as it is, and you make the world as you wish it was. So that’s why the inductive process is so important.

Shripati Acharya 26:40

So I’m going to move on from the jobs framework to Clayton Christensen. Clayton, of course, one of the iconic figures in business thinking over the last 25 years, and you had the opportunity and the privilege of working directly with him. So could you share what are some of your best memories and learnings that you could perhaps share with our audience.

Stephen Wunker 27:04

Oh! I could talk a long time about that. Clay was very unusual for a business thinker. And he was rated the number one business thinker in the world a couple years ago, in that he’s very humble. And he saw himself first and foremost as a moral leader, not as an intellectual thinker.He conveyed that in his company which I was in. He conveyed that with his students the last lecture of his course was always about how you measure your life and to apply the theories that he taught in his class to your own life, conveyed that in his church. He saw management as a profession that was noble because it is where you could help the most people. Which is very different than how most managers, business thinkers approach things. So that’s number one.

And that’s when the eulogies came for him early this year when he passed away. It was very heartening to see that so many of them lead not with number one business thinker in the world, but with his morality, and how he conveyed that to people. As he sometimes said, Look, when I pass away, and I’m at the gates of heaven, God is not going to say, well, you get in because you were a very prestigious thinker at the Harvard Business School. It’s what have you done with your life? So that’s number one. And I think related to that was that he knew his priorities. So there was once we had these visitors and they were from South Korea, and they were from a very prestigious company in Korea, and they were very senior executives. And I took them to his office at the business school to have a conversation. And he made us wait about 20 minutes outside while he talked with the student about his term paper. And of course, I was going crazy at the time. But he knew his priorities. He was a teacher first. He was a businessman second, and that compass really enabled him to navigate the humongous pressures that he had in life to an astonishingly effective degree.

He also taught me about how you communicate business ideas. He had a tremendous talent for making the complex, simple. I’ve worked with him on his healthcare book, for instance. And the US healthcare system is just amazingly complicated. And no sane person would ever develop the system. And yet, not being a healthcare specialist. He was able to make these very complicated phenomena that we were seeing into very simple systems. And he would do it through speaking in parables, through telling stories. He was a senior leader in his church and he said, Well, look, this is how Jesus made the complex simple too, he told stories, so he would find a business parable that fit his purpose. And you know, like I could go on and on I’ll just use one more, which is that when he met with a senior executive. The first thing he did was listen, he did not preach, then he would use logic and examples or parables to help the person come to their own conclusions.

He said the first time he met with Andy Grove at Intel, Grove just wanted the answer. And instead, he told a story about the steel industry, carefully chosen story. And it took a lot longer than Andy Grove who’s very impatient wanted. But at the end, he just sat back. And he pondered, and then Grove said, I got it. We’re like these people. And we should do this. Because otherwise we’re going to be US steel and we’re going to go bankrupt and had clay just lead with that recommendation, he never would have had the impact.

So even in situations like that, he felt that you could teach and you teach by listening and then telling stories and helping somebody arrive at a conclusion, rather than trying to be the smartest person in the room, and solving everybody’s problem for them. So anyway, that’s a few takeaways from a really amazing not just carrer but amazing life.

Shripati Acharya 31:10

That is such a great note to end on. So let me ask where can people reach out to you or learn more about your work.

Stephen Wunker 31:20

So the company, again is New Markets Advisors, that’s markets with an S otherwise, that’s a real estate firm in Las Vegas. But also for our books, we have websites. So for jobs to be done, it is jobsroadmap.com, and that will redirect to the new markets website and the page about that book and for Cost-O-Vation, it’s costovation.com. We also have an earlier book called capturing new markets, which is capturingnewmarkets.com, and we have ots of tools and frameworks and articles about those books available there. And of course, they’re all available on Amazon and other booksellers.

Shripati Acharya 31:57

Well! Thank you Stephen and thanks for your time.

Stephen Wunker 31:59

Thank you, I enjoyed It!
 

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